• by Wayne Friedman , Staff Writer, June 9, 2016

The whole issue of agency kickbacks from media companies now comes right in the middle of the TV upfront market negotiations.

The Association of National Advertisers (ANA) report said there was overall a need for full “disclosure” of the media-buying process.
And yes, TV’s upfront is one of the biggest media buying events.

This is the second time in two upfront seasons where there has been a non-marketplace external factor hitting the TV market. Last year, there was a slew of high-profile agency reviews that many said gummed up the process of doing TV upfront deals.

That said, those reviews probably had little effect on the actual health of the upfront TV marketplace -- where volume was down a couple of percentage points and pricing was up by weak, low-to-mid-single-digit percentage increases.

Maybe this year as well. That’s because months before the start of actual upfront negotiation, media agencies and TV sellers work up game plans -- even if specifics/budgets from clients aren't known.

Long term, some chinks may appear -- to media, to media agencies, to advertisers -- when it comes to possible changes in “disclosure.”

The ANA said media kickbacks come in many forms including rebates, which could be the form of free media inventory credits, or “service agreements." Concerns are also over “dual rate cards,” where media agencies act both as “principals” and “agents.”  ANA didn’t name names, but it did imply potentially criminal activities.

To be fair, we aren’t just talking TV. The ANA found “non-transparent business practices” were found virtually across all media, including digital, print and out-of-home.

Though not quite in the same vein, many believe the upfront process to be an antiquated mode of TV advertising purchasing -- especially with the variety of options to cut back on upfront commitments, if not outright cancellation.

Networks are already talking up new first-party-data TV viewing deal-making -- and other negotiations. That means some openness to changes.